Lehman Brothers Holdings Inc's chief executive Richard Fuld said the fourth largest U.S. investment bank is 'sound' as it matched its previous loss forecast on Monday by restating an unacceptable $2.8 billion loss for the second fiscal quarter.
During the quarter, the bank took $3.7 billion in write downs for assets which include mortgage securities. It amounted to the ever quarterly loss for the bank since it became a publicly traded company in 1994.
In that period, the bank cut back its holdings of mortgage products by 20 percent. Last week, after announcing the expected loss, the bank replaced its chief operating officer and chief financial officer. It also said it raised $6 billion to bolster its balance sheet.
Our core business and our strategy are sound,'' Lehman Brothers chief executive officer Richard Fuld said during a conference call with analysts after the release of the report. He also said the $2.8 billion loss result was totally unacceptable.
The bank said it lost $5.14 per share in the second quarter, which ended May 31. During the same quarter a year ago, the Lehman reported a net income of $1.27, or $2.21 per share.
Due to the impact of the asset write-downs, revenue was negative $668 million, compared with $5.5 billion a year earlier.
Shares of Lehman Brothers rose $1.75, or 6.48 percent, to 27.56.